The Trump administration has announced a significant tightening of export controls on Chinese companies, particularly those in the semiconductor industry, in a move aimed at impeding China’s technological advancement.

US Tightens Export Rules, Adding Entity List Subsidiaries

The U.S. Department of Commerce has introduced stricter regulations that automatically add subsidiaries of entities on the government’s “entity list” to the blacklist, the Financial Times reported. This list comprises foreign entities and individuals subject to export controls, requiring U.S. companies to obtain a license for exports to these groups.

The new rule is applicable to companies that are 50% or more owned by entities on the entity list.

Notably, the new rule does not specifically target China but includes subsidiaries of Chinese chipmakers such as Huawei and Semiconductor Manufacturing International Corporation (SMIC).

The Commerce Department aims to close a loophole that previously allowed exports to subsidiaries of listed companies unless the subsidiary was also ...